Airbag industry in India to grow exponentially in coming times. Here's why
Airbag industry is one of the fastest-growing among auto components in the country and it is expected to continue with its upward flight in the times to come thanks to several factors. According to ratings agency Icra, the airbag industry in India will grow from present figures of around ₹2,500 crore to around ₹7,000 crore by FY2027.
One of the key factors adding wind to the sails is the mandatory rule to equip all passenger vehicle models and variants with a minimum of six airbags. Union Minister Nitin Gadkari has confirmed that this will come into force from October 3 of 2023 and will be a big step in ensuring passenger safety in a country which ranks notoriously high in the list of road accidents and fatalities. As such, Icra notes that the mandatory six-airbag rule will bolster sales exponentially. "The mandatory content per vehicle for airbag manufacturers is expected to rise from ₹3,000-4,000 currently to ₹8,000-10,000 by October 1, 2023. The average number of airbags per car sold is about three currently, and this is expected to increase significantly post the mandatory implementation of six airbags per car from October 1, 2023," Icra Vice President and Sector Head Vinutaa S said.
One airbag was previously mandatory - for the driver - in a passenger vehicle. This was updated to at least two in each car. From October of 2023 onwards, two side and two side curtain airbags will be made mandatory for all cars being manufactured from the said date onwards.
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Airbags require several sub components with the inflator itself forming around 50 per cent of the cost. Most of these sub-components are currently imported but Icra notes that manufacturers have already begun to scale up capabilities.
And while there have been concerns of the increased production cost adding to the final price of a vehicle that a customer has to pay, Gadkari previously highlighted that each airbag costs just ₹800 and that safety ought to be paramount in all cases.